NEW YORK —
Did stores shoot themselves in the foot?
Major retailers like Target and Macy’s offered holiday discounts as early as November and opened stores on Thanksgiving Day. It was an effort to attract shoppers before Black Friday, the day after Thanksgiving that traditionally kicks off the holiday shopping season.
Those tactics drew bigger crowds, but failed to motivate Americans to spend.
A record 141 million people are expected to shop in stores and online over the four-day Thanksgiving weekend that ends Sunday, up from last year’s 137 million, according to the results of a survey of nearly 4,500 shoppers conducted for The National Retail Federation.
But total spending is expected to fall for the first time ever since the trade group began tracking it in 2006, according to the survey that was released on Sunday. Over the four days, spending fell an estimated 2.9 percent to $57.4 billion.
The survey underscores the challenges stores have faced since the recession began in late 2007. Retailers had to offer deeper discounts to get people to shop during the downturn, but Americans still expect those “70 percent off” signs now during the recovery.
And stores may have only exacerbated that expectation this year. By offering bargains earlier in the season, it seems they’ve created a vicious cycle in which they’ll need to constantly offer bigger sales. Shoppers who took advantage of “holiday” deals before Thanksgiving may have deal fatigue and are cautious about buying anything else unless it’s heavily discounted.
“The economy spoke loud and clear over the past few days,” said Brian Sozzi, CEO and chief equities strategist at Belus Capital Advisors. “We are going to see an increase in markdowns.”
Matthew Shay, president and CEO of The National Retail Federation, said that the survey results only represent one weekend in what is typically the biggest shopping period of the year. The combined months of November and December can account for up to 40 percent of retailers’ revenue
Overall, Shay said the trade group still expects sales for the combined two months to increase 3.9 percent to $602.1 billion. That’s a higher pace than the 3.5 percent pace in the previous year.
But to achieve that growth, retailers will likely have to offer big sales events. In a stronger economy, people who shopped early would continue to shop throughout the season. But that’s not the case in this tough economic climate.
“It’s pretty clear that in the current environment, customers expect promotions,” Shay said. “Absent promotions, they’re not really spending.”
Take Tuesday Trasvina, 37, said she’s been bombarded with holiday discounts since early November. Trasvina, a marketing coordinator, plans to spend $500 on holiday gifts, about a quarter of what she spent last year.
“They’ve been stretching out this Black Friday thing so long,” said Trasvina, who was shopping with her husband on Friday at a Target store in Portland, Ore. “I just think the over-commercialization of the holiday has gotten to us.”
At least a dozen major retailers — most of them for the first time — opened on Thanksgiving instead of on Black Friday, which is typically the biggest shopping day of the year. Wal-Mart, Toys R Us and other retailers said on Friday that Thanksgiving crowds were strong.
But the early start appeared to pull sales forward. Black Friday sales fell 13.2 percent from the previous year, according to Chicago-based technology firm ShopperTrak. But combined spending over Thanksgiving and Black Friday rose 2.3 percent to $9.74 billion compared with a year ago.
A Kmart store in New York City that opened at 6 a.m. on Thanksgiving and stayed open for 41 hour straight was packed on the holiday. Clothing was marked down anywhere from 30 percent to 50 percent.
Adriana Tavaraz, 51, headed there at about 4 p.m. and spent $105 on ornaments, Santa hats and other holiday decor. She saved about 50 percent.
But it’s not likely Tavaraz will head out to stores too many more times this holiday season. Money is tight this year because of rising costs for food and rent, and Tavaraz already spent much of her $200 holiday budget.
“Nowadays, you have to think about what you spend,” she said. “You have to think about tomorrow.”
Sara Sell in Portland, Ore., contributed to this report.
NEW YORK —
Did stores shoot themselves in the foot?
Dalton company expands after acquisition
A Dalton welding supplies firm has seen its workforce doubled from three to six after being acquired by a Tennessee company last week.
Werner Braun: Downtown Dalton is thriving again
When I think about the past few years in Dalton, I’m struck by how much has changed both for the community and for me as well.
US home prices rose at solid pace in January
U.S. home prices rose in January after three months of declines. A tight supply of homes might have helped boost prices and offset sales slowed by cold weather.
Data breach hits Target's profits, but that's only the tip of the iceberg
In its first financial release since the December breach that enabled the theft of millions of customers' payment data, Target said profits fell 46 percent and that the breach had already cost the retailer $17 million. The final tally will be bigger, the company said, but it's unclear by how much.
Boe says goodbye
When Ralph Boe took the helm as CEO of Beaulieu of America in June 2007 things didn’t look good for the company. Soon, they would look much worse.
The rich get richer while the middle class suffers
Sam Lewis knows he’s one of the lucky ones.
During the Great Recession, the Dalton metropolitan area, which includes Whitfield and Murray counties, lost some 13,100 jobs and saw its unemployment rate rise from 4 percent in May 2007 to 10.9 percent in November 2008.
Windstream cuts 22 jobs in Dalton
Windstream announced Friday the company plans to cut 22 jobs in Dalton as part of an estimated 400-job reduction nationwide.
Werner Braun: Toxicity vs. hazardous substances
As a chemist and toxicologist back in the day, I have a pretty good understanding of the difference between a substance which contains toxins but does not pose a health risk and a toxin-containing substance that should be considered hazardous.
Facebook buying messaging app WhatsApp for $19B
Facebook is buying mobile messaging service WhatsApp for $19 billion in cash and stock, by far the company’s largest acquisition and bigger than any that Google, Microsoft or Apple have ever done.
Werner Braun: Rec department is vital to our community
It starts in the parks.
That’s a pretty catchy statement, and it’s one that definitely set the tone for a presentation that our Carpet Capital Rotary Club members heard recently. That’s when Dalton Parks and Recreation Director (DPRD) Steve Card shared with us many of the good things that are going on at the DPRD.
- More Business Headlines
- Dalton company expands after acquisition